Italy's Saipem Wins Contracts in Syria and Kuwait

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Researched by Industrial Info Resources (Sugar Land, Texas)--Saipem SpA (BIT:SPM) (Milan, Italy), which is a 43% owned affiliate of Eni SpA (BIT:ENI) (Rome, Italy), has announced that it has been awarded two oil field contracts in the Middle East worth a total of more than $1.2 billion.

The two contracts are to be implemented in Kuwait and Syria. In Kuwait, the leading infrastructure project developer, Kharafi National (Safat, Kuwait), has awarded Saipem the engineering, procurement and construction (EPC) contract for the early production facilities at the Jurassic oil field, which is in northern Kuwait, approximately 50 kilometers to the northwest of Kuwait City.

Kharafi has entitlement rights to extract and process the crude oil from the Jurassic field. The first phase of the project will consist of oil and gas treatment facilities, as well as the gathering system and associated pipelines, which will be constructed adjacent to a sulfur granulation plant. The first phase is expected to be completed during the second quarter of 2013.

According to the Kuwait News Agency (Shuwaikh, Kuwait), Saipem will take over the management of the completed facility for a five-year period. The facility is expected to produce about 150,000 barrels per day when in full production.

The second contract is a lump-sum turnkey contract awarded to Saipem by Dijla Petroleum Company (DPC) (Damascus, Syria), which is a joint operating company formed by Gulfsands Petroleum Company (LSE:GPX) (London, England) and the state-owned Syrian Petroleum Company (Damascus, Syria) for the central processing facility (CPF) on Block 26 of the Khurbet East oil field.

Saipem has been awarded the EPC contract for the CPF, which has been designed to have an initial capacity of 50,000 barrels of fluid per day. Of this capacity, it is expected that the CPF will process 33,000 barrels of oil each day.

The contract calls for the CPF to be completed within 20 months of signing and is estimated to be worth $129 million. The Khurbet oil field is in northeastern Syria and was discovered in June 2007. Block 26 covers an area of approximately 5,414 square kilometers. Gulfsands, through DPC, has the rights for a development and production period up until February 2033.

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